GGRAsia – Macau Legend widens 1H loss, Laos casino still closed

Macau Legend widens 1H loss, Laos casino still closed

Aug 28, 2020 Newsdesk Latest News, Macau, Top of the deck

Gaming and hotel services firm Macau Legend Development Ltd widened its first-half loss, to just under HKD550.2 million (US$71.0 million), from nearly HKD107.5 million in the prior-year period.

The consolidated loss included the operation at the Savan Legend gaming resort in Laos, as well as its Macau business.

The firm’s directors decided there would be no interim dividend, said Thursday’s results filing to the Hong Kong Stock Exchange.

Macau Legend runs three casinos in Macau under so-called service agreements with Macau casino licensee SJM Holdings Ltd. They are: Legend Palace Casino, Babylon Casino and Landmark Casino. The firm also runs hotels and other leisure facilities at Macau Fisherman’s Wharf.

The filing stated that Savan Legend Casino in Laos had been temporarily closed since March 29, due to the Covid-19 pandemic. All Macau casinos had at least a 15 day pause in February, as a Covid-19 countermeasure.

Macau Legend’s group revenue for the six months to June 30 fell 66.3 percent year-on-year, to nearly HKD364.1 million, versus HKD1.08 billion in the prior-year period.

Half-year gaming revenue dipped 66.9 percent, to nearly HKD287.1 million, from HKD867.5 million. The company blamed the decline on the negative impact from the coronavirus pandemic.

The group’s adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) were negative by HKD215.1 million, compared to a positive number of almost HKD151.5 million in the first half of 2019.

The management said in commentary on the first six months of this year: “Given the outbreak of Covid-19, there has been a significant contraction in the gross gaming revenue [GGR] of Macau for the first half of 2020.”

It added: “Fortunately, given the continuing strong support from our local customer base, Macau Fisherman’s Wharf’s gaming business did better than the overall market for this period.”

The firm noted GGR at the two casinos at Macau Fisherman’s Wharf – Legend Palace and Babylon – “contracted approximately 67 percent” for the first six months of 2020, while “the overall gaming market in Macau contracted approximately 77 percent for the same period”.

In Thursday’s filing, the company said additionally it had “sufficient working capital to satisfy its present requirements for at least 12 months from the end of the reporting period.”